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Philippines-focused private equity firm ready to invest $87.1m fund

Navegar and 20 backers target food, health and education sectors

The skyline of the Makati business district in Metro Manila: Navegar's new fund will have a target investment size of up to $18 million each.   © Getty Images

CEBU, Philippines -- Navegar, a Philippines-focused private equity firm, has made an initial close of its new fund at $87.1 million, with 20 investors committing to the vehicle, according to the fund's latest regulatory filing.

The new fund - Navegar II LP - will invest in middle-market, growth-oriented companies in the country, with a target investment size of up to $18 million.

Navegar first filed with the US Securities and Exchange Commission (SEC) to raise $150 million for the new vehicle but the target amount has been increased to $200 million.

The new fund will be a sector-agnostic Philippines-focused private equity fund. It will mainly focus on investing growth capital in companies that are active in growth sectors such as food & beverages, BPO, tourism, healthcare, and education.

Navegar II LP, launched last month, received $20 million from the International Finance Corporation (IFC), a member of the World Bank Group. IFC said Navegar II LP is expected to help improve access to long-term risk capital for fund investees in the Philippines that should lead to accelerated investee growth.

Dutch development bank FMO also proposed a $20-million investment in the fund, which is expected to boost PE funding in a country where PE capital is still very scarce.

It will be the second investment by FMO in a Navegar fund. In 2013, the bank committed $20 million to Navegar I Parallel LP, its investment vehicle parallel to the main fund Navegar I LP.

The fund will is managed by Navegar GP Ltd, a partnership between local partners Honorio Poblador IV, Javier Infante, Rodel Manansala, Swedish national Patrik Brummer, and Norwegian national Anders Stendebakken.

Last year, Navegar exited its investment in the US- and Philippines-based outsourcing startup TaskUs, which was bought by Blackstone for a reported $250 million. The Philippine investor had invested $15 million in the startup in 2015.

Navegar’s current portfolio companies include The Bistro Group, a premium casual dining operator in the Philippines; Bo’s Coffee, a homegrown coffee chain; and Bistronomia, an F&B group that operates premium Spanish restaurants.

Early this year, Navegar joined other leading venture capital PE players in the Philippines in creating an investment industry association that will act as a unified voice representing professional and institutional investors in the Philippines.

Called the Venture Capital and Private Equity Association of the Philippines (VCAP), this non-stock, non-profit corporation was the brainchild of ICCP SBI Venture Partners, Navegar, Endeavor Philippines, and Kickstart Ventures, Inc. with support from Romulo Mabanta Buenaventura, Sayoc & de los Angeles Law.

VCAP’s mandate includes building linkages with similar associations in other countries, raising the profile of the VC and PE asset classes, serving as a platform for potential dialogue on regulatory and policy issues affecting venture and private equity investments in the country, and promoting professional development of the member firms and employees.

DealStreetAsia is a financial news site based in Singapore that focuses on corporate investment activity in Southeast Asia and India. Nikkei recently announced the acquisition of a majority stake in the company.

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